Archive for the ‘future’ Category

The impression of a yawning gulf between two worlds was hammered home today.

On the one side we have reckless gamblers, known as bankers, again raking in cash and handsomely rewarding themselves, on the other there is a threat of extremely severe cuts in local services.

Add that to the high levels of unemployment and the collapsing infrastructure of the nation and I can only repeat again that we are in serious danger of becoming the new serfs to the new feudal lords.

This morning’s Financial Times carries a long report (Do-it-yourself warning as state cuts back) of forecasts by the most senior Local Authority professionals. So serious is the matter that we have a joint report from the Society of Local Authority Chief Executives, and the Chartered Institute for Public Finance and Accounting.

They expect a cut in local services by one third over the three years 2011, 12 and 13. With Alistair Darling forecasting government cuts of over an eighth one might wonder how George Osborne is going to ensure ‘we are all in this together’! If he becomes Chancellor…

The idea of bankers paying their fair share – any share – of the ‘fine mess they’ve gotten us into’ recedes more every day. They complain that they would not be able to hold onto the best staff otherwise. To which the question must be ‘Best for what?’.

“But there is undoubtedly going to be a need for individuals and families and communities to do more for themselves, along with the voluntary sector, rather than looking to the state as the provider of first resort,” comment our doughty professionals.

Bankers, of course, faced no such restrictions to save their bonuses. And, to make that possible, we are seeing the price we will have to pay for a very long time. Who says ‘the prices is worth it?’ Not those doing the paying.

For me this raises a very important question. Who is all this for?

We are dazzled with figures about how we must trade, we must find the cheapest labour, we must become efficient. But must we?

It certainly makes company balance sheets look better. But who is that for? Not for you and me. Does it matter how cheaply goods are imported if we are out of work and unable to buy them? If just having our refuse collected costs an arm and a leg – or if it is not going to be collected at all?

It raises many questions about how we organise our world; and many questions about what is important to us as people. Over the coming years those questions will be major discussion points.

We are offered figures which show green shoots of hope. Today’s double whammy from national and local government leave me feeling distinctly in depression.

Hardly a ripple seems to have crossed the media pond at the threat to bring an end to the cheque.

Paper documents to enable the transfers of moneys have been around almost since the dawn of banking. Indeed there is evidence of written authorities in the first century BC.

The praescriptiones was believed to be the Roman name in the first century BC. In the 3rd century AD Persian Empire (Sassanid) banks issued Sakks, while Muslims were known to be using sakks from the ninth century.

The Knights Templar ran a nice little earner, using drafts, for pilgrims to the Holy Land for a couple of centuries via their chapter houses. And by the fifteenth century the use of paper by merchants to carry money between major cities was well established across Europe and areas of Asia and the Middle East. Fragments found show the 12th century cheques were remarkably similar to our own

Now our unromantic money men wish to end the paper trail some two millennia, or more, after it started.

Now I am pretty critical, but the Council is not blind to the whole picture: “…special account must be taken of the needs of minority and disadvantaged groups…” it declares, with suitable gravitas.

It then spoils the declaration with the fait a compli smug comment “…so that they can share in the benefits of innovation. We are asking what can be done to ensure that all sectors of our society can benefit from the move to more efficient means of payment.”

Well, as it happens, the cheque remains the only paper trail of payment for the ordinary person. Anyone who uses digital technology, on which all other systems are based – and we all use computers, is fully aware how easily mistakes can occur, and how big (though fortunately rare) a catastrophe is.

It also ties us more closely to the banks than ever before. We can have little confidence in them after their comments following the strange judgement form the law lords sitting in their nice new supreme court. Indeed that case was about the distinctly fishy behaviour of the banks; how nimble their fingers are in our pockets!

Read this consultation document. If, like me you prefer to use cheques often, or appreciate the difficulties for the elderly and the lonely and the isolated. please send a comment to these worthy ladies and gentlemen to help them in their deliberations.

And, in the gadarene rush to the card, think also of the person who has hit troubles that mean they are denied the use of those cards. Are they to become the excluded of the new society?

Dallas and Dynasty, old tv soap operas, competed in dramatising the worlds of the rich. Perhaps the biggest icon of them was Joan Collins in dresses [sorry gowns] with shoulder pads that almost defied parody.

It seems the shoulder pad is back. But not just the shoulder pad, but the Joan Collins knock-you-down version. Apparently pads are being stacked vertically or horizontally.

Extreme shoulders, I am told, take four in each shoulder. Such is the sudden take of the new look that one major store reports a sell out in all its stores!

The objective is to give confidence in the boardroom, or other workplace.

I thought this might be disparaging, until I saw it was a co-production between Avon and the Federation of Small Business.

The report suggests the number of enterprises run by women could double in 10 years, to a total of 2 million. This includes the one person business to larger ones.

Increases in women on company boards and women millionaires are both forecast, as is the end of the glass ceiling. Almost as a redundancy the report points out the obvious that “…the workplace will become more female-friendly…”

Talking of redundancy this is also part of the switch of breadwinner. As more and more men are finding themselves first in the job-loss line, it rests with the lady of the house to start a business to keep that roof over their heads.

Unfortunately I cannot find a link to the report, nor find the name of the report – not even in the FT news story. Tut, tut. When I was a journalist…

I have just released this press release; as you see it is a matter of some seriousness

The new Lending Code, which replaces the credit and financial difficulties sections of the defunct Banking Code, is due to come into effect on November 1. Some nineteen short days away.

There is to be no public sight of these changes, nor any consultation process before these changes come into effect.

Specialist author Joseph Harris – Debt Control Man – has been trying to get sight of these changes since June. He has been told they will not be released until they are in effect on November 1 by Paul Ross, the man who is writing the new document for the British Bankers Association, in an email.

“This is a clear case of dictatorial behaviour,” declares Mr Harris. “It is a disgrace that no one concerned with the field, nor any debtor – whether defaulting or not – has any idea how the changes will affect them.

“Vince Cable was wrong when he said Gordon Brown had changed from Stalin to Mr Bean. On the basis of this secrecy and undemocratic behaviour he remains Stalin.”

Phone calls and emails to the FSA and the OFT result in classic Civil Service dropping the query into the new virtual filing bin.

“Even though there are many rules to help debtors negotiate the treacherous waters of finding the best way for their needs, too many creditors and debt collectors – including the biggest companies – do their best to sidestep them.

“Lack of a clear knowledge of what is happening among debtors and their advisors leaves these worst companies a window of opportunity to harass and bully particularly the poorest and most vulnerable debtors,” adds Mr Harris, author of Control Your Debt Crisis on Your Own Terms http://www.controlyourdebtcrisis.co.uk/book-cydc/cydc_Book_intro.shtml .,

“It is also a tragedy that the opportunity to include the requests of the Treasury Select Committee in 2005 and of the Money Advice Liaison Group has been lost.”

While most of the Banking Code is being operated as statutory Code of Practice directly by the FSA, the credit and financial difficulties sections move to the The Office of Fair Trading to sit beside the OFT’s duties controlling issue of Consumer and Business Credit Licences.

In trying to sort the changes out, particularly in how they affect defaulting debtors, I have been led a merry dance.

I think I have emailed or phoned or both, almost every player in this game of musical chairs.

Finally I remembered that the last time I needed to make sense of this area I got sense from the Banking Code Standards Board. So my thanks to them once again.

I have since spoken to others to try to get detail of how exactly the changes will take effect from November 1. That is pretty close for all those who will be affected, especially the helping organsiations like the CABs and Law Centres.

It seems that while most of the Banking Code disappears into the winding corridors of the Financial Services Authority, the parts dealing with lending move to the Office of Fair Trading – except they don’t.

The wording of the new Lending Code [possibly that is the title] is to be managed by the British Banking Association, which has always done it, and it will be monitored by the Standards Board, which has always done that!

And the OFT will, er, enforce fair treatment, and it has always done that!

So welcome to the new-old, different and unchanged system.

Well the changes have to be re-written, but it seems there will be little time for picking up any errors in wording or possible interpretation. And I understand nothing new will go in before 2011.

Not the advice of the Treasury Committee of 2005, nor that from the Money Advice Trust on behalf of MALG in 2007 – nor anyting else.

I assumed that the take over of the Banking Code by the Financial Services Authority (FSA) is going to make a much more useful regime, from the point of view of the debtor.

Now I am far less certain.

Catching up on material like the comments to the last review of the code, and comments on the FSA proposals, I find that the FSA proposals appear to change from the rule approach to a ‘principles-based’ one.

Now your guess is as good as mine as to what that means. Next month the FSA is to publish its proposals – for adoption in November. Do keep an eye open for these proposals.

The Citizen’s Advice Bureaux (CAB), for example, expresses great concern about the proposed changed of style and the fact that the enforcement will be even less than the limp penalties under the British Banking Association (BBA) regime.

CAB points out that the very ones who are most likely to suffer are the vulnerable, the very ones that any system of regulation is most vital to. And, boy!, what grand quagmires lie ahead for interpretation of principles.

The ordinary debtor already faces a seriously uphill struggle. The information most needed is obscure, the area is one they are not familiar with, and they face trained and professional takers backed by massive organisations who wear their legal departments like the six guns of a ‘black hat’ in western films.

The FSA, the FOS and the OFT are all supposed to be making that ‘playing field’ more level and refereed. With this change in prospect my fear is that the field will turn into a blood bath of the innocent. Just like Peterloo.

[Peterloo happened shortly after the Battle of Waterloo and named as a disgraceful mirror of that greatness. It happened on St Peter’s Field near Manchester in 1819. This peaceful meeting was demanding the reform of the parliamentary system – déjà vu!

The crowd of over 60,000 unarmed civilians was charged by cavalry. The whole history of the period was one of the two Britains; that of the industrial and agricultural owners and that of the ordinary people. At least Peterloo shamed the political leadership and reforms followed.

The great 1832 Reform Act was one and the introduction of a civilian police force another. The latter unarmed in response to the shame of Peterloo.]

Can there any longer be any doubt that our political system in the UK is broke? Or that the world financial system is broke? Or our economy, or the way we allow companies to be our bosses? They say ‘if it ain’t broke, don’t fix it’. But what we need to know now is what to do when it IS broke!

One thing that is not broke, even if it is limping rather seriously, is our democracy here in the UK and those throughout the world. And in theory we run it all through democratic process. I mean, well, we DO – don’t we?

😉

OK, take out those that are seriously adrift, like Zimbabwe in the hands of the most evil of people: Mugabe. And be a little kindly to the emerging ones like China.

We are left, frankly, with an awful lot of dross! Here in the UK we have our daily feast of a Parliament in crisis, courtesy of the Daily Telegraph (fully justifying the freedom of the press); and the media’s status as the fourth estate.

In America as well as here the sights of incompetent bankers being rewarded for their reckless and criminal gambling and of businesses that should have folded decades ago being massaged back to life in intensive care leaves one wondering where our leaders minds are.

We cry for heads to be put on pikes in traditional style and for the tumbrels to roll again.

But we have an opportunity. An opportunity that comes rarely. A chance to bring our democracy – not to some golden past that never existed – but further towards a golden future that urges us on in hope.

And democracy is about DEMOS, the Greek word for people or populace and now to represent democracy itself. We are Demos and the democracy is ours; as always the Greeks really did have a word for it.

I have been seriously distracted for some time; there are many things that I wish to put before you, about debt matters, about this list above, about a new approach to a constitution, about the need to completely rethink company law.

Much of this must be essays, and I will put those on my website, Control Your Debt Crisis ; but I will run a long series here as an introduction to those ideas. For a real discussion of all this I will set up a forum which will be readable to all, but will ask people to register to contribute [spam makes that necessary] in which I hope we will find lay people and experts discussing how to get from where we are to somewhere a lot better.

I do not often discuss the wider economic picture here. This is because there is enough to discuss on issues of how to control one’s own affairs.

But I do feel that this is one of those times that wider events are going to impact on exactly that, and quite seriously.

My view of the direction of the British and of the world economy is extremely bleak. For me this is no recent conversion. For as long as I can remember I found the idea of exponential growth in a finite world merely disaster waiting its opportunity.

It is my belief that now the changes will be quite dramatic; if they are understood then there can be an orderly and planned move to the changes.

But in the interim you and I need our wits about us. And the first move is the opposite of the ‘wisdom’ from official circles. You need your cash more than some over-exposed company. You have no duty to spend. Rather you have a duty to think how you will manage in the next years if there is a drop in your income.

And – unless you are one of the few lucky ones – your income will not rise and is most likely to fall. This will look acceptable as deflation operates for a few years. But the actions of governments, and the continued thinking – that if you are in debt you should borrow your way out – promises a massive inflation following on from that.

In terms of debts and repayment, my advice is to is to ensure you have kept in your own pocket everything you possibly can; and I give advice on that elsewhere. While it may feel like a good idea to repay debt as fast as you can it may not be your best approach at this time.

In view of the difficulties ahead I may write more on the wider picture, but for now please think very carefully when faced with any expenditure – including repayments.

For a moment I think we all believed the Government had actually wanted to help mortgagees. We should all have known better.

And talking of Better, it seems outside the financial casino no one gets real help.

Anyway, I know mortgages are not my speciality, but the fading, like the fairy dust it was, of the substantive part of the promise was remarkable.

First it seemed homeowners were going to be really, really helped with a six month – something or other with the banks holding fire on giving defaulters a hard time. Though I was never clear if it was a moratorium, a halt to rude phone calls, or just a six month delay before the repossession papers get served – any way eight banks said they’d do it.

That’s our curate’s egg of owned, part owned, and almost owned banks. Nationalised, as any self respecting linguist might say!

Then it seemed that homeowners at risk of having problems on their payments were going to be really helped by some long arrangement to give them breathings space. And that turns out ot be a mouse’s squeak of a ‘part’-deferral of interest payments for up to two years.

Which might be fine for those with interest only payment policies, but may be a tiny sum for many others.

And then it seems only one in ten would be helped at all by the final proposals…

Smoke and mirrors anyone?

Still it has all successfully hidden the laws for totally random stop and prove identity to be given to the police. And that one about lie detector tests for benefit claimants.

Er… will that be some miracle test that is reliable that we have never heard about, and will the identity proof turn out to be only these dodgy identity cards that Gordon loves so much?

Ah well, you don’t want to know about that anyway. But make sure you read the small print if you feel you would like some of this help with your mortgage.

Unless you want billions, in which case Gordon will mortgage you and I and several generations of our dependents, I suspect this tuppenny-halfp’ny aid on mortgages will come with chains…

How is it, that when I saw Peter Mandelson was involved, I started looking for the catch?

Our Business Secretary with Gareth Thomas, Consumer Affairs Minister, held a meeting with credit card companies [not sure who came, but I’m looking!] to get more time for debtors to organise their affairs. The target was described as ‘breathing space’. http://uk.reuters.com/article/personalFinanceNews

Now I am not even sure how that fits with the information that the reason for the meeting was to express concerns to the representatives about the high level of interest rates charged on credit and store cards.

And a joint statement declares: ‘…the … industry would report back in two weeks’ time [sic – note superfluous “…’ time…”] on a set of fair principles to help card borrowers to manage their debts… [my italics and my disgust!].

I’m not asking you to share my despairing feelings about the poor grammar from senior members of the government, but I am asking you to note how debtors will be hurt, not helped, by all this.

Bear in mind the Consumer Credit Licence, the Consumer Protection Regulations 2008 and the Banking Code all give much better protection than a set time. Not to mention the directives of the European Union Commission – of which Lord Mandelson was, until recently, a Commissioner. Is he with the people or with business?

AND let us be quite clear, this is an attempt to steal the right to represent oneself. An attempt to breach ancient British law.

The new dictatorial requirement will be that ‘…customers in difficulty would now get 30 days grace … IF [my emphasis] a debt advice agency was [not “is”, note] helping … a repayment plan…’. Further in this from this arrogant group ‘… could be [my emphasis] extended for a further 30 days subject to demonstratable progress being made…’.

My own experience is that I have negotiated for myself with 11 companies, and none of these negotiations were completed inside the incredibly restrictive 60 days of this great gift from the keen brain of the Lord Mandelson. In fact I have four negotiations which are taking over 18 months.

Who is to judge, in the terms of this carve-up, what is demonstrable progress. In negotiation one is in a starting position of disagreement, and the idea that one side or the other may be an arbitrator is nonsensical and dictatorial.

And, by the way, what about the role of the Financial Ombudsman Service which this undercuts in the most destructive way – certainly from a debtors’ point of view.

And the industry has ‘…agreed to look at [my italics] its practice of risk-based re-pricing…’. Readers of this blog will know I wrote a series of articles many weeks back on the disgusting level of interest rates. That the government has only just paid attention to we ordinary people who are truly hurting shows how little regard it has for us.

A government spokesman is reported to have said the government is ‘unhappy’ about ‘increases of up to 10 per cent OR MORE [my emphasis]’.

Well, I don’t know about you, but I want a government that is raging angry about such profiteering and instead of inviting the sector to make the debtor’s position worse is prepared to actually make them obey the existing regulations.

That the negotiations appear to be set on limiting our options, and not improving them is worrying to say the least.